That is not the total amount of armor you can have. for the best results get as much armor as you can. Go with the little blue written Total Armor. I fight higher level opponents and that is part of what protects me

Plus as you level up it takes more armor to reach the cap. Better gear now helps you later with your armor cap. Not to mention better gear is just... well.. better. No reason to turn it down really. Stats increases are essential no matter where they come from.